TESCO has seen its profits fall by 55 per cent to £354 million (€481.7 million) from last year’s figure of £779 million (€1 billion).
The figures were released on Wednesday October 7 as Dave Lewis, chief executive of Tesco, admitted that there was “more deflation to come.”
Tesco has dropped its prices across hundreds of products in the face of competition from discount supermarkets such as Aldi and Lidl. They are aiming to cut annual costs by £400 million (€543.8 million) with the group’s Blinkbox operation, an online video service, and its final salary pension scheme has already closed down.
In a move set to save £250 million (€340 million), Tesco have also relocated its head office to Welwyn Garden City.
“We have delivered an unprecedented level of change in our business over the last twelve months and it is working. The first half results show sustained improvement across a broad range of key indicators,” said Mr. Lewis.
The group has closed 43 stores, delayed indefinitely plans for 49 new developments and recently announced that its 24-hour opening at selected Extra stores will soon come to an end.
The supermarket has not commented on the accounting scandal which rocked Tesco last year. It is understood that Tesco is in discussions with the Serious Fraud Office to settle a criminal investigation after overstating its profits.